Photo: James Bombales
While plenty of attention has been paid to Canadian home sales and prices this month, there’s one metric that has been receiving less buzz, even as it starts to creep upwards.
New listings jumped in both Toronto and Vancouver in September, giving buyers a bit more choice in the famously tight housing markets.
“Not that long ago, a lack of supply was often an issue limiting activity, especially in Vancouver and Toronto,” writes Robert Hogue, a senior economist at RBC, in his most recent note. “The upshot for buyers is that they’re seeing more options in the marketplace.”
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Listings rose 4.4 percent month-over-month in Vancouver and 5.2 percent month-over-month in Toronto in September. That has meant different things for each city — Toronto had been inching towards a sellers’ market over the summer, while Vancouver has been solidly in balanced territory for months.
“In Toronto, this easing in demand-supply conditions reversed part of the tightening that occurred over the summer though balance prevailed,” writes Hogue. “In Vancouver, the easing has brought the market closer to buyers’ market position. This explains why Vancouver’s benchmark price has been under significant downward pressure lately, including in September.”
Ultimately Hogue sees the uptick in listings as good news for the Canadian housing market, and a sign that it is continuing to adjust to stricter mortgage qualification rules and higher interest rates.
“The cooling of Canada’s market — especially Vancouver and Toronto — remains on track,” he writes. “We expect overall activity to stay more or less in a holding pattern over the coming year.”
What does that holding pattern look like? A small 2.8 percent home resale gain in 2019, and a 10.2 percent decline for 2018.
“We project Canada-wide prices to increase just barely by 0.8 percent next year following a 3.1 percent gain this year,” concludes Hogue.